End of the Beginning - Year 2 of 'Three More Years'

[wingfooted]

I find it helps organize my thoughts to post here on an annual basis with progress towards a retirement plan and how the latest current thinking compares with the previous periods. So forgive the repetition if you've seen my story before and fast forward to the update at bottom.

There is much debate on this site about 'what is the meaning of life' and 'how much is enough'. There are as many answers as there are individuals. This is my plus DW's personal journey and reflects our own goals, aspirations and tolerances.

POSTED Summer 2011

After 20 years overseas assignment, looks like events are moving in my direction to FIRE in 2012.

Mid 50's, married,no kids. Worked overseas for Oil Service Co. - hardship assignments in not so nice hell holes with some personal danger. Own house in Houston plus Oregon farm of 160 acres - decent size but non commercial. Total real estate value of $1.1M all paid for, no mortgage. No other debt, credit cards are paid in full every month, six cars and four motorcycles all paid for between Texas and Oregon.

Current salary in the mid- $200's plus bonus. Wife is stay at home / doing her own thing. Made the first million in my 40's basically through overseas assignment differentials, low out of pocket cost, tax benefits and a good run of capital gains in the market although I suffered with most in 2008. Luckily missed the big real estate crash, the Houston house is modest and farmland remains in good demand. After the first million, the second and third come fairly quickly with any kind of investment success and continued savings.

Brokerage account of $1.2M , Roth IRA of $ 0.3M, other cash savings of $0.3M all after tax. The division I head up will be divested sometime this year and am looking at share of the sale valuation plus leaving benefits in the range of $0.6M after tax. Proceeds of all the lump sum distributions to transfer to the Brokerage account. Passionate about investing and stock market.

I could hang on with the new company if I wanted to but at this point it doesn't seem worth the bother unless the rewards are superb. Frankly I have other interest I want to pursue, feel burnt out and life in a foreign country is wearing on me.

No pension, social security to start at age 70. All the calculators say that I am financially prepared to ER.

The plan at this point is to sell the house in Texas, build in Oregon and transfer residency to Oregon in 2013 after all the lump sums are paid out (for state income tax reasons). I will gentleman farm, maybe run a part time business connected with farming and get back into some of the hobbies I have been unable to pursue these many years. Medical insurance to transfer to state pool after Cobra exhausts. Not sure how my wife will adjust to farm life (Green Acres scenario) and that is probably the biggest danger to the entire plan.

Worried about the state of the USA, welfare economy and what the future holds when we can no longer sell promises (bonds) to the Chinese. So feel that rural Oregon is a good place to hunker down for a future that may be quite different than today

POSTED Summer 2012

For the most part the divestment of the various divisions both in the USA and overseas went as planned and I realized the after tax benefits anticipated last summer. Assets now consist of $1.9MM in brokerage, $0.25MM Roth IRA, $0.3MM other plus the fully paid real estate including the Oregon farm property.

However, several UNANTICIPATED developments have arisen in the last year.

1. One of the overseas divisions did not sell and I have been asked to continue on in basically a caretaker role for the next three years while it is packaged along with other units for a strategic sale. Better salary, less stress and chance at a big 'pot of gold at the end of the rainbow' bonus at the end of three years, with or without a sale.
2. So now faced with signing on another three years overseas, which even without the big bonus will significantly upgrade financial resources available post retirement with a corresponding increase in safety margin.
3. Conclusion is that it is too tough to turn down the three additional years. It also allows enough forward visibility to begin construction of the house on the Oregon farm.
4. DW is having a tough run of medical problems back in Houston and it may be that she can never re-locate to a rural setting in Oregon.
5. So another financially based reason to hang on another three years.

I know this is common for 'one more year' to creep into the retirement decision. This is a 'three more years' variant. Part of me says just do it, the rational side says hang in there and build resources while I still can and while the rewards make it easy to save.

POSTED Summer 2013

Financially making progress with gains in our taxable brokerage account. Like many others here, the market has been good these last months. $2.4MM in taxable brokerage, $0.25MM Roth IRA, $0.3MM other plus the fully paid real estate including the Oregon farm property.

1. The 'caretaker' job is moving right along, no worries. Feel rather bored but it is manageable. Moved the overseas house to a less stressful, more comfortable location but still in the same country.
2. DW is doing well and is under treatment / therapy for her RA. She made it out to the farm in February and will also come out for the month in September. So doing much better.
3. We both continue to work on plans for the Oregon house build. Probably be at a point where the preliminary sketchup drawings can be submitted to a design firm before year end.
4. 'Pot of gold' bonus is on track and the business is well ahead ahead of the incentive targets on a run rate basis. Barring any major economic or business crash of course. Hate to put it in the bag at this early point but looking good.
5. It took a while and a few iterations to get the 'pot of gold' negotiated so my 'three more years' was pushed back and did not start until 01 January 2013.

UPDATE Summer 2014

Financially hit a great run in the stock market with significant gains in the taxable brokerage account despite writing a huge check to the Treasury Department in April. Big winners were overweight positions in AAPL, APC, PXD and CXO. $3.9MM in taxable brokerage, $0.4MM Roth IRA, $0.4MM other cash plus the fully paid real estate including the Oregon farm property.

[1] The caretaker job seems to have morphed to caretaker plus another two persons job's and am busier than ever with a heavy travel schedule. No longer bored that is for sure.
[2] MIL passed in May after long illness and DW ran her own health into the ground during the process. Making some improvement now but has a long way back.
[3] We hired designers for the Oregon house build and went through the design process, site visit, concept stage, first revision, second revision, et al. With DW not in the best of health plus high cost of the projected farm MacMansion --- have put the entire project on the backburner for now. May revive if the bull market keep running or DW's health improves, alternatively downsize Oregon scope and keep the Houston residence.

[4] 'Pot of gold' bonus looking very positive with 17 months left to go and projected value of $1.5MM after tax. Definitely worth hanging on for.
[5] Boss is wanting to re-look at package post year end 2015. Have to see what can be negotiated in context with transitioning back to the USA and whether or not it is worthwhile to keep w*rking.


NEXT UPDATE Summer 2015

 

[heeyy_joe]

Being away from my DW working while she battles health problems would conflict me terribly. Very expensive price to pay for the extra dough.

 

[freedomatlast]

Being away from my DW working while she battles health problems would conflict me terribly. Very expensive price to pay for the extra dough.

+1

 

[Senator]

Great job on the gains. Almost home free. Don't get caught up on chasing the dough to some foreign land that causes issues to your own health. There are plenty of stories about oil workers getting in the wong hands.

It does seem like everyone is a multi-millionaire.

 

[BigE]

Thanks for the update. I remember your previous posts, kind of a cool story with the "farm" property in Oregon. You have done very well for yourself financially but there is almost always a cost in terms of physical and mental health and you have pointed this out for both you (working in dangerous situations) and your spouse. I would guess you are late 50s now. With no kids to worry about and your level of finances, the question becomes how many good years of retirement do you have? I would get out ASAP if I were you. You have won the game, go enjoy the new house in Oregon. By the way, love the architectural drawing of the new house. Congratulations.

 

[robnplunder]

You have won the game, go enjoy the new house in Oregon.

+1 but I seriously doubt the OP will oblige. Reading between the lines, the OP can't seem to let go of all that extra $$$. I am in a similar boat but I don't think I have "won" the game yet, and am younger at age 52. I sure hope I don't end up posting a similar thread 5 years from now. If I do, someone please shoot me .

 

[ERhoosier]

Being away from my DW working while she battles health problems would conflict me terribly. Very expensive price to pay for the extra dough.

Do not mean to insult OP, but many would call that a deal-breaker regardless of j#b's pay grade. Very personal decision.

 

[wingfooted]

Thanks for comments, just some rational for why I am committed to chasing the 'pot of gold' and sticking around another seventeen months.

1. High probability of DW needing long term care and is uninsurable for same. So making sure all the financials are in place is not a selfish decision.
2. In the context of a 35 year career, seventeen months is not a long time.
3. I've committed to my boss to follow through on a three year contract, small company - individuals count, I have over 200 third world families that are depending on me to transition gracefully.
4. I've really got a chance here to transition from 'FI' ($2MM net worth) to 'Rich' (> $10MM net worth). Too attractive to not take my shot.

 

[Walt34]

If I could make that much of a difference in 17 months I'd probably do it too.

 

[kimcdougc]

Seems like you have more than enough to call it quits now. I had open heart surgery last year to replace an aortic valve and got to think of my own demise. Life is short. You don't get time with loved ones back. Good luck with your decision since we all have to determine what is important to us. All I know is I couldn't have gotten well as quick as I did without my DH being there emotionally and physically to help me through it. I am 54 and he is retiring at the end of this year at 57. Just my 2 cents.

 

[Milton]

My feedback, FWIW (and bearing in mind that I certainly don't know all of the facts):

High probability of DW needing long term care and is uninsurable for same. So making sure all the financials are in place is not a selfish decision.

Fair enough, but it seems like you already have sufficient assets to self-insure for that contingency.

In the context of a 35 year career, seventeen months is not a long time.

I'm not sure that your past career duration is particularly relevant … that's water under the bridge.

What is more important is your future life expectancy, and that of your wife. By the sounds of it, she may well have very few 'good years' left: in which case those 17 months may turn out to be more precious than they seem now.

I've committed to my boss to follow through on a three year contract, small company - individuals count.

Some might feel that loyalty to your wife should trump loyalty to your boss.

I have over 200 third world families that are depending on me to transition gracefully.

No one is irreplaceable. Is it really likely that those 200+ families will be destitute if you advise the company that (say) you've decided to leave five months from now rather than 17?

I've really got a chance here to transition from 'FI' ($2MM net worth) to 'Rich' (> $10MM net worth). Too attractive to not take my shot.

Although this was the final rationale in your list, I suspect that it may well be the primary motivation … especially given your willingness to consider the boss' stated intention to extend your employment beyond 2015.

Like ERhoosier said, no offence intended; please disregard any or all of the above if they don't work for you. I do appreciate your point that "this is (your) personal journey and reflects our own goals, aspirations and tolerances".

 

[Walt34]

T...I have over 200 third world families that are depending on me to transition gracefully.

Is it really likely that those 200+ families will be destitute if you advise the company that (say) you've decided to leave five months from now rather than 17?

Actually wingfooted makes sense to me and I'd have a very hard time bailing out when I'm in a position to make that big a difference to that many people. Especially people who don't have a lot of alternatives. That would weigh heavy on my mind.

Y'see, it's not about the money. It's about responsibility.

 

[pb4uski]

No disrespect, but why would one want a MacMansion in retirement even if one could afford it? Much more to maintain, keep clean and tidy, etc. Unless you have cleaning staff, not for me.